Sweetened beverage taxes and changes in beverage price, imports and manufacturing: interrupted time series analysis in a middle-income country

• Published in: The international journal of behavioral nutrition and physical activity 2020-07, Vol.17 (1), p.1-90, Article 90
• Main Authors: Teng, Andrea, Puloka, Viliami, Genç, Murat, Filimoehala, Ofeina, Latu, Catherine, Lolomana'ia, Mohulamu, Osornprasop, Sutayut, Signal, Louise, Wilson, Nick
• Format: Article
• Language: English
• Subjects: Beverages; Bottled drinking water; Chronic diseases; Comparative analysis; Confidence intervals; Energy drinks; Food; High income; Imports; International trade; Manufacturing; Market shares; Milk; Monte Carlo simulation; Pacific; Prices; Quasi-experimental methods; Soft drink; Soft drinks; Sugar-sweetened beverages; Sugary drinks; Tariffs; Tax increases; Tax rates; Taxation; Taxes; Time series; Tonga; Trends
• ISSN: 1479-5868; 1479-5868
• DOI: 10.1186/s12966-020-00980-1

The Pacific Island nation of Tonga (a middle-income country) introduced a sweetened beverage tax of T$0.50/L in 2013, with this increasing further in 2016 (to T$1.00/L), and in 2017 (T$1.50/L; US$0.02/oz). Given the potential importance of such types of fiscal intervention for preventing chronic disease, we aimed to evaluate the impact of these tax changes in Tonga. Interrupted time series analysis was used to examine monthly import volumes and quarterly price and manufacturing 1 year after each tax change, compared with a counterfactual based on existing trends. Autocorrelation was adjusted for when present, and adjustments were made for changes in GDP per capita, visitor numbers, season and T$/US$ exchange rate. In the year after the 2013, 2016 and 2017 tax increases, the price of an indicator soft drink increased by 16.8% (95%CI: 6.3 to 29.6), 3.7% (- 0.6 to 8.3) and 17.6% (6.0 to 32.0) respectively. Imports of sweetened beverages decreased with changes of - 10.4% (- 23.6 to 9.0), - 30.3% (- 38.8 to - 20.5) and - 62.5% (- 73.1 to - 43.4) respectively. Juice imports changed by - 54.2% (- 93.2 to - 1.1), and sachet drinks by - 15.5% (- 67.8 to 88.3) after the 2017 tax increase. Tonga water bottling (T$) increased in value by 143% (69 to 334) after the 2016 tax increase and soft drink manufacturing increased by 20% (2 to 46, albeit 5% market share). Consistent with international evaluations of sugar-sweetened beverage taxes, the taxes in Tonga were associated with increased prices, decreased taxed beverages imports, and increased locally bottled water.